The Hartford has launched Private Choice Ovation, a package policy for private company management liability, extending coverage to private securities fundraising techniques, reimbursement for notification costs and expenses related to a data privacy breach and optional defense cost sublimit for wage-and-hour violations.
“As small and midsize business owners navigate increasingly complex laws and regulations governing employment practices, data privacy and private securities, even the best-run organizations can be at risk of a lawsuit,” said Tom Tucker, SVP and chief underwriting officer for The Hartford’s commercial markets division.
Wage-and-hour lawsuits have been increasing for the past five years, according to the Federal Judicial Center, and The Hartford said the new policy addresses new areas of concern for business owners, including allegations of violations of the federal Fair Labor Standards Act.
“Wage-and-hour disputes are among the leading and fastest growing causes of employment practices liability claims today,” Tucker said. “Defending these types of allegations can cost an organization thousands of dollars and be detrimental to its business.”
Data privacy laws and the 2012 Jumpstart Our Business Startups (JOBS) Act also have created new coverage needs, The Hartford said. Data breaches are increasingly common for all businesses and the cost of notifying customers and related expenses can be heavy, as can the capital raising and reporting requirements of the JOBS Act legislation, which creates additional liabilities related to privately held securities.
Private Choice Ovation offers a package of customizable management liability coverages, and management teams can select from the following coverage parts: directors, officers and entity liability; employment practices liability; fiduciary liability; kidnap and ransom/extortion; and crime, The Hartford said.
“These enhancements are an example of our commitment to developing products and services that address the emerging needs of private company management teams,” Tucker said.
